Removing Barriers Blog

We are Dissapointed in CFPB's Rejection of Bipartisan Calls for Expanding Exemption Authority

Posted August 11, 2016 by CUNA Advocacy

In recent meetings with CFPB staff, we have heard that the Bureau does not intend to expand use of its Section 1022 Exemption Authority to relieve credit unions of regulatory burden. Despite recent letters signed by 399 Members of Congress – bipartisan supermajorities of both chambers – the Bureau appears to have rejected this call for regulatory relief. The Senate letter from Sens. Joe Donnelly (D-Ind.) and Ben Sasse (R-Neb.), carried a similar message as the bipartisan letter signed by 329 members of the U.S. House--led by Reps. Adam Schiff (D-Calif.) and Steve Stivers (R-Ohio)--that was sent to CFPB Director Richard Cordray March 14.

So this week, along with all 37 credit union leagues, we sent a letter to CFPB Director Cordray expressing our strong disappointment with this latest position.

The letter explains that Section 1022 of the Dodd-Frank Act gives the CFPB statutory authority to exempt any class of entities from CFPB rulemakings: “The bureau’s resistance to the plain language of the statute and the subsequent bipartisan message of more than three-quarters of the elected representatives in the federal government is baffling and disrespects the consumers who elected the Congress,” the letter reads. “We strongly encourage the bureau to reconsider its perspective on Section 1022 and finalize rules that allow credit unions to continue to offer services to consumers under the current regulatory scheme.”

We believe that Congress clearly intended to give the Bureau the ability to exempt any class of entity from its rulemaking. Where there is no evidence of harm to or abuse of consumers, the Bureau should exercise this authority so that providers that have been serving consumers in a safe and affordable manner can continue to do so efficiently. The Bureau’s resistance to the plain language of the statute and the subsequent bipartisan message of more than three-quarters of the elected representatives in the federal government is baffling and disrespects the consumers who elected the Congress.

Since 2010, the cost of credit union compliance with regulatory burden has risen from to $7.2 billion in 2014 from $4.4 billion in 2010, according to our recent regulatory burden study.

Credit Union National Association is the most influential financial services trade association and the only national association that advocates on behalf of all of America's credit unions. We work tirelessly to protect your best interests in Washington and all 50 states. We fuel your professional growth at every level and champion the credit union story at every turn.